Cyprus central bank chief fights back| MENAFN.COM

Monday, 04 July 2022 07:00 GMT

Cyprus central bank chief fights back


(MENAFN- AFP) Cypriot central bank governor Panicos Demetriades hit back Friday at President Nicos Anastasiades's moves to sack him, saying criticism of his performance was unjustified and undermined banking sector confidence.

Anastasiades, frustrated over delays in approving the new board of the Bank of Cyprus (BoC) and Demetriades's perceived failure to get a handle on saving the economy, wants him axed.

But in an interview with the semi-official Cyprus News Agency, Demetriades said he was being treated unfairly.

"In the last few months, the central bank has taken a lot of measures which have a positive effect on stabilising the banking system," he said.

He said completing a plan for restructuring the cooperative banking sector, leading BoC out of resolution and strictly adhering to an adjustment programme imposed as part of the island's 10 billion euro ($13.4 billion) bailout were factors that earned praise from the Eurogroup and the IMF.

"Taking this into account I feel the criticism from the president was unjustified," said Demetriades.

"Political interference in the supervisory role of the CBC... is not conducive to restoring confidence in the financial sector," he added.

Cyprus clinched the bailout from international lenders in March. The deal included a restructuring of the banks, with the island's second-largest lender, Laiki, wound up and its good assets folded in to the largest lender, BoC.

Anastasiades told Mega TV Wednesday he was unhappy with the governor's performance and no longer has confidence in him.

He said he was seeking legal action to remove Demetriades, and would go to the Supreme Court.

Under the constitution the central bank chief cannot be sacked. His removal may only be decided by the courts.

When asked about delays in the central bank approving the board members of the country's largest lender Bank of Cyprus, Anastasiades said: "This cannot go on any longer."

BoC shareholders elected last week a new 16-member board, six of whose members are Russian, including the vice chairman.

Demetriades has been criticised by political parties and business organisations for his delay in evaluating the new directors, which has not been finished 10 days after the annual general meeting.

Asked why candidates were not vetted before the vote, Demetriades said the required documentation was absent for a large number of would-be board members.

Demetriades, appointed by Anastasiades's communist predecessor Demetris Christofias, has come under mounting criticism for his handling of the bailout and the banking crisis aftermath.


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